Costs related to the closure of retail stores were among the factors contributing to reduced second-quarter earnings for Singapore’s Wing Tai Holdings.
Store closures caused a 12 per cent rise to S$23.8 million in administrative and other expenses quarter-on-quarter, according to a stock exchange filing by the company.
Lower rental income and depreciation from its Singapore retail outlets also resulted in a 20 per cent fall in distribution expenses to S$22.2 million from S$27.7 million. No dividend was declared for the quarter.
Wing Tai’s retail division represents the brands Adidas, Fox Kids and Baby, Topshop, BCBGMaxazria, G2000, Topman, Burton Menswear London, I.T., Uniqlo, Dorothy Perkins, Karen Millen, Warehouse, Etam, Pumpkin Patch and Yoshinoya. The company also has hospitality, residential and commercial property interests.
Also contributing to the second-quarter net profit fall of 85 per cent year-on-year to S$1.08 million were lower contributions from the property development segment and a higher tax rate. These were partially offset by a stronger share of profits from associates/JVs, and lower distribution expenses.
Overall, the group said earnings had come in below expectations as its operating and sales environment had proved tougher than anticipated. However, it is confident it is well-positioned to ride out the current down-cycle with its portfolio of prime residential and investment assets.
Cooling measures will continue to weigh on market sentiment in Singapore this year, the group expects, while economic conditions in Malaysia will probably keep sales soft.